Does the Level Crossing Removal Project Have Good Value for Money?

Few infrastructure programs in Victoria's recent history have generated as much debate about value for money as the Level Crossing Removal Project. Since the Andrews government launched it in 2014 with a promise to remove 50 level crossings, the program has grown — first to 75, then to 85, then to 110 — and the cost has grown along with it. We are now talking about a program worth well over $20 billion in total.

So: is it worth it?

The instinctive criticism from some quarters is that the money could be better spent on new rail lines or more frequent services. But I think this critique, while not entirely wrong, misses a lot of what the LXRP is actually delivering. Let me try to make an honest assessment.

What the Program Actually Does

The first thing to understand is that "level crossing removal" is a bit of a misnomer in terms of what the project actually delivers. Yes, it removes dangerous intersections where cars and trains meet. But a lot of the value is in what gets built above and below ground at the same time.

Most of the removals involve either rail elevation (the sky rail approach) or rail trenching (lowering the track below street level). Both approaches typically involve rebuilding the stations in the affected area — and these aren't just functional rebuilds. The stations that have come out of the LXRP are, by the standards of Melbourne's suburban rail network, genuinely excellent. Coburg, Frankston's rebuilt precinct, the Pakenham line elevation stations — these are well-designed, accessible, covered, and fitted with decent amenities. They replace stations that in many cases hadn't been properly upgraded since they were built in the mid-20th century.

The road crossing removal itself is also a genuine community benefit. Melbourne had a remarkable number of level crossings for a city of its size, and the worst of them created significant traffic congestion, noise for nearby residents, and real safety risks. The crash statistics at some of these crossings were genuinely alarming. In that sense, the project is as much a road infrastructure program as a rail one.

Then there's the rail operations benefit. Level crossings impose what's called "dwell time" on train operations — the train has to slow approaching a crossing, wait for gates to clear, and so on. Removing crossings allows trains to run faster between stations, and in some corridors this adds up meaningfully. On the Cranbourne and Pakenham lines, the combined effect of multiple removals and the associated track upgrades has meaningfully reduced journey times.

The Cost Question

Here is where the project attracts legitimate scrutiny.

The cost per crossing has escalated significantly over the life of the program. Early crossings came in at somewhere in the $50 to $100 million range. More recent removals have been considerably more expensive, with some complex CBD-adjacent projects costing several hundred million dollars each.

Some of this escalation reflects the genuine complexity of later projects. Removing a level crossing in a flat outer suburb with a simple at-grade station is a different engineering proposition from trenching the rail line through a densely built inner suburb with heritage overlays, underground services, and narrow road corridors. The easy ones got done first; the expensive ones are what remain.

Some of it also reflects broader construction cost inflation, which has been brutal across the Australian infrastructure sector over the past five years. This is not unique to LXRP — virtually every major infrastructure project in the country has experienced significant cost blowouts relative to initial estimates, driven by materials costs, labour shortages, and supply chain disruptions.

And some of it, one has to acknowledge, probably reflects the normal tendency of big government programs to grow in scope and cost as political incentives align around adding more sites to the list.

Whether the cost per crossing is "good value" depends enormously on what counterfactual you're comparing it to. If the question is "could we have built more kilometres of new rail for the same money?" the honest answer is probably yes, for some of the simpler crossings in locations where rail extension wasn't needed. But if the question is "what would have happened to Melbourne's road network and community amenity if these crossings stayed?" that's a different calculation.

The Case For

Let me make the affirmative case for the LXRP, because I think it's stronger than its critics often acknowledge.

Melbourne's level crossing problem was genuinely serious. The city had over 170 dangerous crossings when the program began — more than almost any comparable city in the developed world. Several people were dying at Melbourne crossings every year. The economic cost of traffic delays at peak crossings was quantified in the hundreds of millions of dollars annually across the network. This was not a minor nuisance; it was a systemic problem that had been deferred for decades.

The LXRP is fixing it at scale. You can debate the individual cost of any particular crossing, but the fact that Melbourne will emerge from this program with a fundamentally safer and less congested intersection network is real and substantial. The freed-up road capacity at major arterials like Clayton Road, Burke Road, Springvale Road, and others is something that will benefit those communities for many decades.

The station rebuilds that accompany the works are also, I would argue, genuinely excellent value when considered on their own merits. Melbourne's suburban stations were, in many cases, in a poor state. Cramped platforms, inadequate weather protection, poor accessibility for people with disabilities or prams, outdated facilities. The LXRP stations are a significant step up — and in a city where the suburban rail network needs to attract and retain passengers against the continuing appeal of car travel, the quality of station environments actually matters.

There is also a land use argument. Several LXRP projects have involved the removal of rail level crossings that effectively severed communities — a train line and its associated barriers can cut a suburb in half in a way that meaningfully impedes local street connectivity and active travel. Sky rail and trench solutions typically restore or improve street connections across the rail corridor, which has real value for cyclists and pedestrians that doesn't always get reflected in the formal cost-benefit analyses.

What the Critics Get Right

I don't want to be an uncritical booster here, because the program does have real weaknesses.

The single biggest one, in my view, is that it has consumed an enormous share of Victoria's transport capital budget for over a decade, and that has come at a cost to other priorities. The Suburban Rail Loop is proceeding — slowly — but other projects that might have delivered more network coverage have been slower to advance. The argument that $20+ billion spent on level crossings could have been better allocated to, say, new rail extensions or dramatically improved bus networks is not silly. It deserves a serious response.

The response I'd give is this: the LXRP was politically achievable in a way that more complex rail extension projects weren't. The government could point to a specific location in virtually every suburban electorate and say "we're removing this crossing." That granular community benefit made it fundable in a way that, say, a network-wide bus frequency increase never would have been. That's not a great defence on pure policy grounds, but it's a real explanation for why the program happened and grew.

The other legitimate criticism is around the program's governance and procurement. There have been concerns about the complexity of the contracting arrangements, the time taken to complete some projects, and the cost of maintaining the delivery authority itself. These are worth scrutiny. Big programs of this kind inevitably accumulate overhead, and the question of whether the LXRP has been run as efficiently as possible is a fair one for the state's auditors and infrastructure agencies to keep examining.

The Value for Money Verdict

If I had to give a verdict, it would be this: the Level Crossing Removal Project represents reasonable value for money, with some important caveats.

The program delivers genuine benefits — in safety, road network efficiency, station quality, and community amenity — that are underweighted in narrowly framed cost-benefit analyses that focus only on rail journey times. The safety case alone, given Melbourne's genuinely problematic crossing history, justifies a substantial portion of the expenditure.

At the same time, the escalating per-crossing costs in later phases of the program, and the broader question of whether this was always the highest-impact use of Victoria's transport capital, are legitimate concerns that shouldn't be waved away. A fully honest assessment would probably say: the first 60 to 70 crossings on the list were excellent value; the case for some of the later, more expensive additions is harder to make.

What this suggests for future policy is that the state should probably be more disciplined about which crossings make it onto any future tranches of the program — prioritising safety hot spots, high-congestion arterial crossings, and locations where the station rebuild creates genuine urban renewal benefits, rather than crossing removal for its own sake in quieter locations where the cost-benefit ratio is harder to justify.

The Broader Lesson

There's something worth saying about what the LXRP represents in terms of Victoria's willingness to actually build things.

Australian cities have a long history of infrastructure planning that goes nowhere. Reports get written, business cases get developed, announcements get made, and then... not much happens. The Level Crossing Removal Project, whatever its flaws, is a program that has actually delivered. Every few months, another crossing gets opened. Communities that lived with boom gates and traffic delays for generations see a genuine, tangible change. That matters.

There's a reasonable debate to be had about whether the money was optimally spent. But a government that commits to a large, complex infrastructure program and actually follows through with delivery — at scale, over more than a decade — deserves credit for that. Melbourne's transport network is meaningfully better than it was in 2014 because of this program, and that's not nothing.

The question for the future is whether Victoria can hold onto the delivery capability the LXRP has built — the project management expertise, the contractor relationships, the community engagement processes — and direct it toward the next generation of network investments that Melbourne needs. That's a question worth watching closely.

Do you live near a level crossing that's been removed, or one that's still waiting? Has your experience matched the promise of the program? Drop a comment below — local perspectives on this are always interesting.

Search This Blog

TransitTube Blog